“A promised European Union investment budget to modernize the recession-hit economy is set to be scaled back in a bonfire of competing national demands,” Bloomberg reports (Neuger, 2/7). “After tense negotiations in Brussels, European leaders reached a historic budget-cutting deal on Friday — but appeared to have spared foreign aid,” Devex’s “The Development Newswire” writes, adding, “The €908 billion deal cuts the E.U. budget for the first time, and it effectively freezes the regional bloc’s aid budget at current levels — a win, perhaps, for a nervous aid community which had lobbied for a slight funding increase but feared drastic cuts after a proposal that stalled last November included just that” (Rosenkranz, 2/8).

“In one respect, it is not completely doom and gloom, as foreign aid has not been slashed,” but “the overall aid budget of $72 billion in 2012 will be stagnant, and it will not put the E.U. on track to meet the U.N. target of 0.7 percent of gross national income (GNI), which the U.K. is set to hit next month,” the Guardian writes (Tran, 2/8). “The budget still needs the consent of the European Parliament,” Devex notes (2/8).